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Inflation - How much does it impact our life?; Joe Stack ko Gussa kyon aaya - If you are angry with Income Tax - just go to nearest airbase, steal a plane and crash it into IRS Building; PM's Council calls for expansion of service tax net and unity of Cenvat and ST rates ; CBDT issues local transfer orders of 34 CITs / DITs for various cities ; CBDT notifies Kolte Patil Developers Ltd as Industrial Park for Sec 80IA benefits; CBEC clarifies on valuation of free samples of products covered under MRP-based assessment; |
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| Dear Member, Sending the following files: |
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TIOL COMMENTARY SC & HCs have not only power and jurisdiction but also an obligation to protect fundamental rights - CBI probe ordered by a HC without consent of State, valid in Law: SC; Inflation - How much does it impact our life? BOOK REVIEW Hakuna Matata - Life is Calling By Nikhil Bagatikar, CA; CASE LAWS State Of West Bengal & Ors Vs The Committee For Protection Of Democratic Rights, West Bengal & Ors (Dated: February 17, 2010) Supreme Court and High Courts have not only the power and jurisdiction but also an obligation to protect the fundamental rights - CBI investigation ordered by a High Court without the consent of the State, valid in Law: a direction by the High Court, in exercise of its jurisdiction under Article 226 of the Constitution, to the CBI to investigate a cognizable offence alleged to have been committed within the territory of a State without the consent of that State will neither impinge upon the federal structure of the Constitution nor violate the doctrine of separation of power and shall be valid in law. Being the protectors of civil liberties of the citizens, this Court and the High Courts have not only the power and jurisdiction but also an obligation to protect the fundamental rights, guaranteed by Part III in general and under Article 21 of the Constitution in particular, zealously and vigilantly.:SUPREME COURT; MIXED BUZZ PC to lay foundation for Integrated Check Post at Attari; PM's Council calls for expansion of service tax net and unity of Cenvat and ST rates |
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ORDER CBDT issues local transfer order of 34 CITs/DITs at various cities; NOTIFICATION CBDT notifies Kolte Patil Developers Ltd as Industrial Park for Sec 80IA benefits; CASE LAWS 2010-TIOL-06-ARA-IT.pdf + ara story.pdf M/s Laird Technologies India Pvt Ltd ( Dated : February 18, 2010) Income Tax - Sec 9(1)(i), TDS - Indo-USA DTAA - Article 5 - Assessee is a Group Co of UK-based company which is into the business of manufacturing electronic components and solutions - assessee is Group's first manufacturing unit in India, located in a SEZ - designs antenna and battery packs for mobile phone industry - its Group Co from USA negotiates a deal with Nokia Global Corporation - a Product Purchase Agreement between them is signed - the USA-based Group Co further negotiates a deal with Nokia for the assessee and assigned all its beneficial rights, title, interest, obligations and duties in connection with supply to Nokia India under the PPA in favour of the applicant - in return, the Indian entity will pay a lump sum consideration to its US counterpart - Whether such payments will be liable to TDS u/s 195 - whether such payments will be governed by the provisions of the DTAA Business profits accrued or arisen in India not liable to be taxed under the Income-tax Act as the recipient has no permanent establishment in India: The amount of consideration received by the US-based Group Co from the applicant is in the nature of business profit that has accrued or arisen in India. However, as the recipient has no permanent establishment in India, the same is not liable to be taxed under the Income-tax Act, 1961 having regard to Art.7.2 of the DTAA. No TDS : The applicant is not required to withhold tax under Section 195 of the Income-tax Act while making remittance to Laird USA as it has not derived any income chargeable to tax in India.:ADVANCE RULING; CIT, Ahmedabad Vs M/s Mastek Limited (Dated: February 10, 2010) Income tax - Sec 37, 35AB - Assessee is in the business of software development - enters into contract with the USA-based company for duplication and retailing of copyrighted software - agrees to share royalty benefits in certain ratio - makes royalty payment and claims deduction u/s 37 - AO takes the view that only one-sixth of such payment is allowable in view of Sec 35AB - CIT(A) deletes the additions as the assessee claims that it has made the payment for 'duplicating' the software and the copyright was retained by the American MNC - further argues that it has only duplicated the software and paid royalty based on the sale value - Tribunal agrees with the CIT(A) - HC declines to entertain Revenue's plea - held, to decide this issue the Revenue has to analyse the process undertaken by the assessee(s), analyse the contracts and the price structure to ascertain the nature of payment. Depending upon the analysis of the process of "duplication" in the context of the contracts signed by the assessee with the American Corporation, one has to find out whether the expense incurred is a Revenue expenditure or a capital expenditure - Case remanded to the HC for detailed examination of facts and deciding the issue on merit: SUPREME COURT; Income tax - Writ petition - Sec 147, 80I - Assessee is a manufacturer of water well drilling rigs - claims deduction u/s 80I - AO invokes powers u/s 147 and reopens assessments beyond four years limitation period - issues show cause notices to deny Sec 80I benefits - held, since Revenue has only issued SCNs which can be issued beyond four years if income has escaped assessment, and the assessee has not challenged the jurisdiction of the AO, it would be ideal for the assessee to file returns in response to the notices u/s 148 and let the AO decide the case on merits - Assessee's petition dismissed :MADRAS HIGH COURT; 2010-TIOL-90-ITAT-DEL.pdf + it story.pdf DSD Noell Gmbh Vs DDIT, New Delhi (Dated: August 31, 2009) Income Tax - profits and gains of foreign companies engaged in the business of civil construction - section 44BBB mandates that income of the assessee is to be computed at 10%.:DELHI ITAT; ITO, New Delhi Vs M/s Sahasra Electronics Pvt Ltd (Dated: January 29, 2010) Income Tax Act, 1961 – Deletion of interest on bank overdraft account – Allowance of deduction u/s 10A on recomputed profit Section 10A, 37 – Whether deduction u/s 10A is to be allowed on recomputed profits of the assessee by the AO:DELHI ITAT; |
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CST, Delhi Vs M/s World Vision (Dated: November 17, 2009) ST - Cenvat Credit - Revenue denies Cenvat Credit and passes ex-parte order - Commissioner(A) remands the case and directs the adjudicating authority to pass speaking order - Revenue takes the stand that the Commissioner(A) does not have powers u/s 35A to remand an appeal - held, the provisions of Section 85 of Finance Act,1994 and Section 35A of Central Excise Act,1944 are different and Sec 85 does not restrict the powers of Commissioner(A) to remand the issue for denovo adjudication - Revenue's appeal dismissed :DELHI CESTAT; M/s Unique Cable Network Vs CCE, Kanpur (Dated: December 29, 2009) ST - Multi-system operator - Assessee receive signals from broadcasters and provide the same to cable operators - charge fee for such services - treats cable operators as its service providers and utilises the service tax paid by cable operators as cenvat credit for discharging its own liability - also files return and TR-6 challans to the Revenue - error detected by Revenue - penalty imposed - held, it is strange that the assessee which is itself a service provider treated its service recipients as providers of service and availed credit - since tax was not paid on the sum collected from cable operators, there is no ground for waiver of penalty - Assessee's appeal dismissed:DELHI CESTAT;
CENTRAL EXCISE SECTION CIRCULAR CBEC clarifies on valuation of free samples of products covered under MRP-based assessment; CASE LAWS 2010-TIOL-136-HC-AHM-CX.pdf + procedural story.pdf CCE, CC & ST, Daman Vs J J Polyplast Ltd (Dated : January 27, 2010) Central Excise – CENVAT Credit – Procedural lapse should not result in denial of admissible credit – Revenue Appeal summarily dismissed: the invoices could have been endorsed by the Daman Office of the same appellant in the name of their Mumbai Office. This is rectifiable defect and can be rectified at any point of time. There being no dispute otherwise about the entitlement of the Modvat Credit, such procedural lapse should not result in denial of benefits to them otherwise admissible credit. It could not give raise to any substantial question of law and, hence, the Appeal is summarily dismissed. :GUJARAT HIGH COURT; 2010-TIOL-135-HC-AHM-CX.pdf + smvij story.pdf CCE & CC, Surat Vs S M Vij (Dated : February 4, 2010) Central Excise – Reduction in penalty – tribunal not required to give reasons. It is well accepted that the reasons are reflecting the decision making process. Reasons introduce clarity in an order. There is no provision in the Rules or even administrative instruction which require the Tribunal to record reasons while imposing the penalty or for modification thereof. In the facts of the present case also, the Tribunal established under the Act is having such discretion and therefore while sustaining the order in toto , as regards the penalty on the individuals, who are the officers of the company, is modified considering the fact that they are salaried employees of the firm and still considering about the role played and their involvement substantial penalty has been imposed to the tune of Rs. 20 lakhs on each individual. It cannot be said that the order is not justified merely because it has modified the penalty on individual from Rs. 2 crores to Rs. 20 lakhs . The mitigating circumstances or a word about this aspect reflected in the order of the Tribunal could be considered as desirable :GUJARAT HIGH COURT; 2010-TIOL-288-CESTAT-AHM.pdfM/s Spectrum Fabrics Vs CCE, Surat (Dated: August 25, 2009) Central Excise – 100% EOU – Original order passed by DC, KSEZ cancelling LOP set aside by way of remand by appellate forum and fresh order passed by DC restored LOP – Revenues suggestion that subsequent order would be applicable from the date of its passing amounts to mockery of justice as it denies fruits of litigation to appellant – Proceedings initiated under Central Excise Act based on initial cancellation of LOP not sustainable – Impugned order set aside:AHMEDABAD CESTAT; M/s Vishwakarma Refractories Pvt Ltd Vs CCE, Bangalore (Dated: April 3, 2009) Central Excise – Valuation – Performance bonus received from customers not includible in assessable value – Impugned order demanding duty with interest and imposing penalty set aside:BANGALORE CESTAT;
CUSTOMS SECTION NOTIFICATION cnt10_016.pdf + cnt10_015.pdf + cnt10_014.pdf + cnt10_013.pdf + cnt10_012.pdf CBEC notifies adjudicating authorities for various cases; CASE LAWS M/s P A B Traders Vs CC, Cochin (Dated: August 10, 2009) Customs - Allegation of mis-declaration of description of imported goods as heavy melting scrap - Examination by Customs found that cargo contained high quality structural beams and pipes - When pre shipment inspection certificate from recognized and registered inspecting agency stated that containers were containing heavy melting steel ascertained after visual inspection of 100% of cargo, importer appellant cannot be faulted for relying on such certificate - Offending goods to be released to the importer after effective mutilation under customs supervision, thereby rendering them as scrap - Scrap so generated after mutilation to be cleared on payment of appropriate customs duty on the values declared by the importer in the documents presented before the authorities - Impugned order set aside :BANGALORE CESTAT; |
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